Donald Trump is set to shelve his $10 billion lawsuit against the IRS—and instead create a $1.7 billion taxpayer-funded pool to pay allies who claim persecution by the Biden administration.
Trump, 79, began his second term by issuing mass pardons to Jan. 6 rioters, and last year said in an interview that setting up a compensation fund for them was a possibility. Now, a big step is set to be taken for their benefit.
The five-member commission charged with overseeing the distribution of funds would be given considerable liberties under the potential settlement agreement, ABC News reported, though the terms of it could change.
Trump could remove members without cause. Beyond a majority vote, the process for determining payment could be kept private, along with the identities of recipients.
The proposed settlement also states that the IRS would apologize to Trump, who sued over a leak of his tax returns during his first term. Trump also claimed $230 million in damages from the FBI’s 2022 search of Mar-a-Lago and the investigation into Russian interference in the 2016 election and any ties to the Trump campaign.
Trump himself, under the settlement, would not be allowed to directly receive payments connected with those claims. But entities tied to him could, sources told ABC.
Payments would be made from the Treasury Department’s Judgment Fund. The fund, sources said, would be part victim compensation fund and part truth-and-reconciliation-style commission.
The Daily Beast has contacted the IRS, the Treasury Department, the Justice Department, the White House, and Trump’s personal lawyer, Alejandro Brito, for comment.
A spokesperson for Trump’s legal team told ABC News: “The IRS wrongly allowed a rogue, politically-motivated employee to leak private and confidential information about President Trump, his family, and the Trump Organization to the New York Times, ProPublica and other left-wing news outlets, which was then illegally released to millions of people. President Trump continues to hold those who wrong America and Americans accountable.”
News of the proposed deal came a few weeks after a federal judge questioned the legality of the president suing agencies he oversees.
Trump’s “named adversaries are entities whose decisions are subject to his direction,” Judge Kathleen Williams of the Southern District of Florida wrote in an order, explaining that no one is truly arguing on behalf of the public.
“Moreover, although President Trump avers that he is bringing this lawsuit in his personal capacity, he is the sitting president and his named adversaries are entities whose decisions are subject to his direction. Indeed, President Trump’s own remarks about this matter acknowledge the unique dynamic of this litigation,” she wrote.
Trump, his sons Don Jr. and Eric, and the Trump Organization sued the IRS and the Treasury Department over an IRS contractor leaking Trump’s tax information to the press in 2019 and 2020.
Trump, the New York Times then reported, had paid a mere $750 in federal income tax in 2016 and in 2017. In 10 of the previous 15 years, he paid no income taxes.
The Times first reported Thursday that the DOJ officials may settle Trump’s lawsuit.
